I manually updated with the official images using
this guide. Note, there are two possible images for part 2. The link in the original post is an incremental update from the 1.6 DMD64 image, the link on page 5 of the thread is for a complete 2.2.1 FRG83 image that presumably can be used if you're still on the 1.5 COC10 build. I did a factore reset before starting. The initial sign-in after flashing both images went oddly. After signing in with the "already have an account" option I got a screen that said to slide out the keyboard to sign in. Hitting back took me to the page with 'create an account, already have an account, skip for now' (yes, the official 2.2.1 image supports getting into the full phone without signing into google, which should be nice for people not using their device with a T-Mobile SIM). I kept trying to sign-in with my existing account and it started rebooting at that point. I decided to skip the sign-in about the third time and I was taken to the desktop. Going to Accounts & Sync my account was there, so it took the info the first time and then a wrong turn after that.
Everything seemed to be working alright except for the Market's restore of my apps that was there from when I ran CM6. All apps were listed as downloading but none of them were. I cancelled most of them, for a few trying to cancel the download caused a Market force close (but everything showed up in my Downloads tab still). Once I started downloading one that I had successfully cancelled, the few that wouldn't cancel suddenly cancelled themselves and restarted. After going thru and making sure everything listed as Free or Purchased under Market downloads had been re-installed everything seems fine now. I've installed a few new things I hadn't had before. Still couldn't find Angry Birds in the Market though. Downloading from getjar.com worked though.
As a metric for comparison against CM6, I can successfully install and use swype without doing any trickery like setting up a swap file, or strategically hitting back instead of next/done during the installer. It just worked.
Performance wise I'm pretty happy. I perceive less lag than CM6, but possibly not as good as 1.6. I liked being able to have 4 launchers docked as I did in ADW, but ADW accounted for probably 90% of the 'not responding' dialogs for me in CM6 so ....
As has been said USB tethering is baked right in. I did some research when CM6 came out and the hardware in this device just doesn't support infrastructure mode so the native mobile hotspot feature will never appear. Using something like branacle or android-wifi-tether to setup an ad-hoc AP is possible with this device if you have root though.